Are We Sitting On Another Stock Market Bubble? | Page 2 | TigerDroppings.com

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GumboPot
LSU Fan
Saints Fan
Member since Mar 2009
25793 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

What role has QE taken in the run up on the markets?


Chases money from low return instruments like savings accounts and bonds into potentially higher return instruments such as equites.






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davesdawgs
Georgia Fan
Georgia - Class of '75
Member since Oct 2008
17945 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

What is causing such a market increase,


I'm no expert but this is my perspective:

1. Most big businesses have been profitable because they are running lean; layoffs have actually forced them to operate more efficiently obviously with reduced payroll. Basically they have gotten rid of most of the dead weight which of course has contributed to the high unemployment numbers. They are also operating with more part-time employees and contractors to avoid having to pay benefits.

2. As bad as things seem in the U.S. in terms of unemployment, fed deficit and rising costs, things are more fricked up in the rest of the world which still leaves the U.S. as one of the best bets for investment. Also, the financial/housing debacle created a lot of cheaper properties and foreign investors have taken notice.

3. The housing market is finally come out of the doldrums. Ongoing low interest rates have made investment in cheaper homes attractive, thus home prices are starting to go back up. Most of the foreclosures associated with the housing bubble/financial collapse have happened and been resolved one way or another. Thus....

4. The financial markets have finally stabilized. Buyers with decent credit are able to get home loans more easily.

IMHO the improvements we are seeing are in spite of negative Obama administration policies including Obamacare, excessive regulation in Dodd/Frank, general bad-mouthing of the rich and greedy corporations, stupid energy policy that encourages failed alternative energy development and wasteful, ineffective pork-barrel spending in general that has done little to stimulate the economy while creating a huge deficit. In other words the typically robust U.S. economy has performed it's cyclic rebound but took much longer this time due to dumbass Obama/Dem policies.



This post was edited on 2/1 at 11:29 am


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TheDoc
LSU Fan
doc is no more
Member since Dec 2005
99297 posts

re: Are We Sitting On Another Stock Market Bubble?


Jim Kramer says everything is rosey





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Lsut81
USA Fan
Member since Jun 2005
65395 posts
 Online 

re: Are We Sitting On Another Stock Market Bubble?


quote:

Are We Sitting On Another Stock Market Bubble?


Almost asked this same thing earlier today went it initially broke 14k...

I'm no financial guru, but I don't see how the hell the Dow is that high with all of the negative hard data that is out there (Unemployment, participation rate, GDP)






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RCDfan1950
LSU Fan
United States
Member since Feb 2007
11245 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

What is causing such a market increase, is it real or substantive and are we are the potential verge of another crash if it is not substantive?


A more revealing question might be, 'if the Fed quit printing would there be another crash? We all know the answer to that.

Another: Will interest rates inevitibly and substantially go up? Effects?

Regardless, it ain't "irrational exuberance"...more like MANUFACTURED EXUBERANCE!







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junkfunky
LSU Fan
Member since Jan 2011
14317 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

I thought the meme was that anytime he did anything the market went down????


That's when he talks about the economy.






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GumboPot
LSU Fan
Saints Fan
Member since Mar 2009
25793 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

I'm no financial guru, but I don't see how the hell the Dow is that high with all of the negative hard data that is out there (Unemployment, participation rate, GDP)


It's not that complicated. It's Bernanke (mainly). ZIRP and QE (MBS purchases now) are making bonds and savings accounts very low return investments. People are greedy and want better returns. The stock market is the main place people are looking for that better return.

The more money in the stock market the higher it goes.






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RCDfan1950
LSU Fan
United States
Member since Feb 2007
11245 posts

re: Are We Sitting On Another Stock Market Bubble?


Question: I think I heard that the very process of the Fed injecting money into the economy is done through banks...who 'launder' it into the dynamic economy, and take their cut. Is that true? And just what sectors of the SM are showing the major gains? Banking? Manufacturing?







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davesdawgs
Georgia Fan
Georgia - Class of '75
Member since Oct 2008
17945 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

It's not that complicated. It's Bernanke (mainly). ZIRP and QE (MBS purchases now) are making bonds and savings accounts very low return investments. People are greedy and want better returns. The stock market is the main place people are looking for that better return.

The more money in the stock market the higher it goes.


Possibly the simplest and most valid explanation I have heard.






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GumboPot
LSU Fan
Saints Fan
Member since Mar 2009
25793 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

A more revealing question might be, 'if the Fed quit printing would there be another crash? We all know the answer to that.


Of course it would. If the FR quit "printing" (buying MBSs and maintaining ZIRP) interest rates would rise and bonds would get cheap. Then money would then flow from equities to bonds and saving accounts.






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CarrolltonTiger
LSU Fan
New Orleans
Member since Aug 2005
46315 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

dynamic economy


What is the dynamic economy? What do you consider 'launder' to be?

What are you trying to say?






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Cold Pizza
Ohio State Fan
Member since Sep 2011
7639 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

I'm no expert but this is my perspective:

1. Most big businesses have been profitable because they are running lean; layoffs have actually forced them to operate more efficiently obviously with reduced payroll. Basically they have gotten rid of most of the dead weight which of course has contributed to the high unemployment numbers. They are also operating with more part-time employees and contractors to avoid having to pay benefits.

2. As bad as things seem in the U.S. in terms of unemployment, fed deficit and rising costs, things are more fricked up in the rest of the world which still leaves the U.S. as one of the best bets for investment. Also, the financial/housing debacle created a lot of cheaper properties and foreign investors have taken notice.

3. The housing market is finally come out of the doldrums. Ongoing low interest rates have made investment in cheaper homes attractive, thus home prices are starting to go back up. Most of the foreclosures associated with the housing bubble/financial collapse have happened and been resolved one way or another. Thus....

4. The financial markets have finally stabilized. Buyers with decent credit are able to get home loans more easily.

IMHO the improvements we are seeing are in spite of negative Obama administration policies including Obamacare, excessive regulation in Dodd/Frank, general bad-mouthing of the rich and greedy corporations, stupid energy policy that encourages failed alternative energy development and wasteful, ineffective pork-barrel spending in general that has done little to stimulate the economy while creating a huge deficit. In other words the typically robust U.S. economy has performed it's cyclic rebound but took much longer this time due to dumbass Obama/Dem policies.


this






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Jake88
George Mason Fan
LSU/Saints Fan
Member since Apr 2005
9951 posts
 Online 

re: Are We Sitting On Another Stock Market Bubble?


quote:

I thought the meme was that anytime he did anything the market went down????


It's not. But, for simpletons who want to pigeonhole the opposition to Obama, that notion can help avoid overtaxing limited synapses.






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kingbob
LSU Fan
St. Amant, LA
Member since Nov 2010
20153 posts

re: Are We Sitting On Another Stock Market Bubble?


yep. The stock market is not indicative of the economy or of the value of the companies listed on it. Eventually, when the artificial stimulus creating this bubble runs out, the market will self correct as the listed value is brought down to reflect the actual value.





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Taxing Authority
LSU Fan
Houston
Member since Feb 2010
23374 posts

re: Are We Sitting On Another Stock Market Bubble?


All I'm going to say is that I pegged the RE bubble by noticing prices were historically high, and volume was historically low.





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skinny domino
LSU Fan
sebr
Member since Feb 2007
6790 posts

re: Are We Sitting On Another Stock Market Bubble?


quote:

Are We Sitting On Another Stock Market Bubble?
two or three threads on the money board about this.






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